Wednesday, December 31, 2008

"A very powerful and durable rally is in the works. But it may need another couple of days to lift off. Hold the fort and keep the faith!" —Richard Band, editor, Profitable Investing Letter, Mar. 27, 2008

Good call, Dick. Except the markets had been gently declining for six months at that point ... and we know where they are now, don't we?

"I'm not an economist but I do believe that we're growing." —President George W. Bush, in a July 15, 2008 press conference

One more of the President's beliefs unsupported by ... you know ... facts. GDP shrank at .5% from July to September. And of course we were in a recession then, as we are in a recession now.

And to be fair and balanced -- we're not being partisan here -- there is Congressman Barney Frank's wrong analysis of Fannie and Freddie:

"I think this is a case where Freddie Mac (FRE) and Fannie Mae (FNM) are fundamentally sound. They're not in danger of going under…I think they are in good shape going forward." —Barney Frank (D-Mass.), House Financial Services Committee chairman, July 14, 2008

Sixty days further on, the companies were in receivership ...

And one more prediction, not from Business Week.

Bolt will do $120 million domestic, and double that overseas. It's gonna come close to $400 million in world box office." -- Steve Hulett

The dude was a tad optimistic on that one. The way it looks now, the white doggie won't hit the $120 million or $400 million markers.

Although I know it's silly to go to studios between Christmas and New Year's because many are as empty as Dodge City during a gunfight , Tuesday I ... went to studios.

Cartoon Network had a few artists working away like demons in selected cubicles, but it was mostly pretty quiet. And at Film Roman/Starz Media ...

... the King of the Hill and Goode Family crews are winding down. As a Gooder told me:

"The first batch of episodes are finishing up, and I'm out of here in January. Who knows if we get a pick up? The show won't be on the air until Spring, and the network will probably take its time about deciding on a full season. I'm going to have to get out there and look for work way before that happens ..."

King of the Hill staff still doesn't know if some other network will pick up a new season of Hank Hill et famille. All anyone appears to be sure of is that Fox is satiated, so it's up to CBS or some other conglom to step up to the punch bowl and drink.

Up on The Simpsons, they're revising the long-time opening to fill the format of the wider, high-def teevee screen. Same elements that everyone has known and loved, now updated to reflect two decades of the shows ever-broadening scope ... and the changes brought by last year's feature.

Television animation in one sentence? Most everybody scrambles to land the next assignment.

... Auditors delivered a 'going concern' qualification to the half year results of Hong Kong- and LA-based animation firm Imagi Int'l which last year delivered "Teenage Mutant Ninja Turtles" for Warner Bros and Weinstein Co.

... [A]udit firm Deloitte Touche Tohmatsu said "it is uncertain whether the Group will have the necessary financial resources to complete these animated pictures."

"At 30 September 2008, the group had bank and cash balances of approximately HK$88.9 million ($11.5 million,) while it is expected to incur approximately HK$512 million ($66 million) cash outlay to complete its animation pictures and to meet its daily operating expenses in coming years up to June 2010 (of which approximately HK$353 million [$45.6 million] is required within the next 12 months) before revenue from the animation pictures is generated," Deloitte said.

"The directors are actively pursuing various funding sources to meet the group's cash flow requirements…. However, it is uncertain whether these fund raising exercises will be successful," Deloitte said. "Consequently, in the absence of evidence that the group will be successful in raising the necessary funding as and when it is required, we consider that there is a material uncertainty which may cast significant doubt on the group’s ability to operate as a going concern ..."

A short while ago, we received a communication from the company that there could be a short hiccup in cash flow, but not to worry. There were plenty of bucks overall and everything would be ducky in due course.

Based on this, maybe things are a tad more serious than that.

The company has several animated features in various stages of production, and a lot of money invested in them. It's going to be grim for the sizable staff working in Sherman Oaks (not to mention Hong Kong) if everything comes to a grinding halt.

Monday, December 29, 2008

... Paramount/DreamWorks' "Madagascar: Escape 2 Africa" led the way with an estimated $31 million from 6,221 locations in 58 territories, raising its international gross to $278 million ...

Among Disney-branded family attractions ... the animated "Bolt" latched on to $6.5 million from 2,300 screens in 24 markets to lift its foreign gross to $45.5 million, and Disney/Pixar's long-running "WALL-E" saw its overseas cume rise to $282.2 million as it held the No. 1 spot in Japan for a fourth consecutive week ($2.1 million, for a market cume of $24 million) ...

Universal Animation's family offering "The Tale of Despereaux" earned $5 million from 1,815 dates in 10 territories, providing an early foreign gross of $7.8 million.

So, my back of the envelope calculations: Bolt has a worldwide take of $150 million; Wall-E is up past $507 million; and Madagascar Deux has $443 million in the till.

What's interesting to note here is that the biggest grossers come from California, while the up-and-comer Despereaux hails from France ... and, if reports are true, cost $60 million to produce.

Add On: In Hong Kong, over the holiday weekend, the jungle animals triumph at the turnstiles:

The Dreamworks Animation feature "Madagascar Escape 2 Africa" took a narrow victory at the Hong Kong box office over the four day Christmas weekend, squeaking into No.1 with $732,000 from a 35 screen release by distributor Intercontinental ...

Sunday, December 28, 2008

While attending a party at the Shelter Island estate of a billionaire hedge fund manager, novelist Kurt Vonnegut pointed out to Joseph Heller, the author of Catch 22, that their host had made more money in one day than Heller's phenomenal best-seller had earned during all the years it had been out.

And Tom Cruise and Valkyrie haul off $8.4 million and the fourth position.

Tale of Despereaux, repping the animated contingent, now has a total of $18.6 million, and Bolt stands at $99.5 million (crossing the $100 million marker as I keyboard).

So the Mouse House's four-legged protganist has bested Meet the Robinsons, but will have to pull off a box office miracle to overtake Chicken Little's $145 million cume. Not gonna happen.

* Add On: This is actually sort of wrong. K. Turan at the L.A Times was underwhelmed with Benjie, but nationwide the film has done pretty well in the reviews department.

Add On Too: Friday results reveals more boodle from heaven among the Top Four:

Marley and Me is out front by a couple of lengths with a holiday total of $28.6 million.

Benjy B. stretches into a comfortable lope, snagging $22 million.

Bedtime Stories finds its way to $20.2 million.

And Valkyrie spits in der fuhrer's face as it ropes in $16.5 million.

Down in the animated categories, The Tale of Despereaux (#7) now has $21,748,000 in its haversack, while 14th place Bolt passes into triple digits with $100,623,000, and Mad 2 continues to truck along with $174,251,000 at the 20th position.

Add On the Third:New entrants finish the weekend just the way they've been finishing since last week: ValCruise follows Benjamin Pitt follows Bedtime for Adam follows Golden Retriever and Blonde People.

But forget all that. What we're interested is the animated cavalcade, so here it is:

At #48 squats Igor, with $19,442,000 in its tunic at the fifteen-week mark.

The 20th slot belongs to Mad 2 ... nailing down $174,870,000 at the end of its second month.

14th place Bolt climbs above the century mark and now chews on $102,761,000 after six weeks.

And The Tale of Despereaux in its sophomore stanza battles its way to $27,945,000.

Saturday, December 27, 2008

What do you do when the distribution method you have relied on for more than a century begins to falter? ...

“Newspapers are declining,” [cartoonist Steven Pastis] says. “For a syndicated cartoonist, that’s like finally making it to the major leagues and being told the stadiums are all closing, so there’s no place to play.”

In November, United Feature Syndicate, which distributes 50 comics, including “Peanuts,” “Dilbert” and “Get Fuzzy,” made its full archives and portfolio available free on its Comics.com Web site. The company also added social networking features for tagging and rating comics. Visitors can have comics sent to them via e-mail or RSS feeds.

... Today, Comics.com serves more as a marketing tool than a significant source of revenue. Ms. Wilson says the site does bring in money from advertisers, which include cellphone companies and Netflix. But its primary function is to build a fan base — and to provide links to sites where fans can buy books, calendars and other items featuring characters from the comics. No one expects Comics.com to fully compensate for what Ms. Wilson calls “declines on the print side.” The site, she says, is “a platform for what comes next.”

Face it, the internet has made it possible to by-pass middlemen. You have a hot idea, you can climb on board the worldwide web and launch the idea all by your little self.

But it also means you have to own a savvy, up-to-date business model. If you're a news or recording company built along 20th century models (vinyl records, CDs, newsprint), you will quickly become history. Record conglomerates like EMI and Warner Bros. have discovered they can't resucitate the old way of doing business (one CD to one consumer) by suing music fans who download off the web. And newspapers aren't going to compete with the Huffington Post, MSNBC.com or Talking Points Memo if they don't streamline and change their older business practices.

And so it is with comic strips, a century-old subset of newspapers.

Mr. Pastis, who recently created a Facebook page for [his comic] “Pearls Before Swine” and is in talks about animating the strip, says it is challenging to appear simultaneously in newspaper comics pages, which have what he calls a “1950s sensibility,” and in a media universe where the younger readers he wants to attract can download episodes of “South Park” to their iPods ...

It might be challenging, but it's also essential for survival. How does that old saw go?

All in all, a pretty fair year for U.S. based, theatrical animation, wouldn't you say?

Add On: A brief article about the highest flying moom pitchers is here. As a commenter says below, Narnia might have made the Top Ten, but the Mouse House bailed on the next installment of the epic anyway.

Friday, December 26, 2008

[Waltz With Bashir] is such a beautiful and strange film. But it's such an unlikely subject for animation. Why did you decide to tell a true story about your memories of the Lebanon war as an animated film?

You know, when you write a story you imagine it, and the scenes in my mind were always drawn, always animated. So there was not another option. I would never do it any other way. And, honestly, I think I wouldn't be sitting here with you today if this was not an animated film. You wouldn't care about what happened to a guy like me 25 years ago, when I was just a common soldier in Lebanon, if you weren't told, "Oh, it's a very cool animated film. You have to see this film."

As a filmmaker it gave me total freedom to do whatever I liked. To go from one dimension to another. To go from real stories to the subconscious to dreams to hallucinations to drugs to fear of death to anxiety, everything. I had the liberty to play with everything in one story line ...

(Add On: The L.A. Times has a new article about WWB and Mr. Folman here.)

Wallace and Gromit might not have set the world afire at the theatrical box office, but they're doing quite nicely on British television.

A Matter Of Loaf & Death, the first new made-for-television adventure starring the animated pair in 13 years, was watched by an average of 14.3 million people, the highest figure for any programme on British television this year ...

[BBC One Controller Jay Hunt said:] "More than half of all people watching television tuned in to watch Wallace & Gromit's latest adventure. This is a phenomenal performance and one that confirms once again BBC One's position as the nation's favourite at Christmas."

Despite the increasing popularity of video games and the internet, it appears that families still enjoy slumping in front of the television on Christmas Day. The average total television audience in peak time was 24.4 million, up from 23.8 million in 2007.

Beginning in February, Toon Disney will morph into the newly named Disney XD. There won't be any High School Musical or Hannah Montana on this Disney network. Instead, this multi-platform brand will feature both live-action and animated fare that appeals to the mud-eating, snot-blowing, rough-and-tumble crowd of boys, tweens and teens. In addition to current Toon Disney fare like Jetix, there will be a number of new shows on XD as well.

The new offerings include Aaron Stone, about a video gaming teen who is secretly being trained as a super agent; Zeke & Luther, a mockumentary about two skateboarders and their quest to become the best in the world; and Kid Knievel, an animated show about a young boy trying to become the world's greatest daredevil ...

And you'll be pleased to know that Bugs Bunny's greatest hits are being played live and in-person by the Vancouver Symphony Orchestra:

The names Carl Stalling and Milt Franklyn don't appear on any list of the great composers of our time. They should be. At least that's what George Daugherty thought back in 1990.

The San Francisco-based conductor developed the super popular Bugs Bunny on Broadway concert series as a way to celebrate the musical genius of the two Warner Brothers cartoon studio musical directors.

For a symphony orchestra to tackle playing live scores to Bugs Bunny hits such as "What's Opera Doc?" or "The Rabbit of Seville" is, in many ways, far more challenging than a Mozart or Brahms concerto. In other words, it's a lot of fun for the musicians ...

Because once you've seen Elmer Fudd chasing about on screen singing "Kill the wabbit, kill the wabbit," you will never hear Wagner's "Ride of the Valkyries" the same way again, whether in concert or in Apocalypse Now.

"That's really why I'm still doing this project after almost 20 years," says Daugherty. "This material is so brilliant that it just doesn't get old." ...

Box Office Prophets does a profile of Pixar's upcoming The Bear and the Bow, a trip into classical fairy tale country for the Emeryville studio:

The Bear and the Bow is set in a mythical Scotland and follows the royal family King Fergus (Billy Connolly), Queen Elinor (Emma Thompson), Princess Merida (Reese Witherspoon) and her three little brothers. Merida wants to pursue her dream of becoming an archer. However, due to her reckless decisions she inadvertently brings disaster and destruction to her father’s kingdom. Realising what she’s done, Merida tries to set things right. Along the way she meets a 15-foot bear and a witch (voiced by Julie Walters).

Eartha Kitt, who played one of the edgier Disney villains in the under-appreciated Emperor's New Groove, died on Thursday. But she was more, far more, than just a Disney evil-doer:

... She broke onto the pop charts with the flirtatiously francophonic "C'est si bon," and capped that with the Top 10 "Santa Baby, in which a gold-digger lays down the law to her sugar daddy. Through these songs, Kitt constructed her persona of the irresistible siren — both young and ageless — who is so sure of her control over men that it's often a chore just to rouse herself for another conquest. As she fairly said, "I am the original Material Girl." That this smooth dominatrix was an African-American, at a time when U.S. blacks were still denied basic civil rights, made her woman-on-top status all the more notable, not to say delicious.
...

SAG's postponement of its strike authorization vote may signal that its leaders are tilting in a more moderate direction -- so much so that the divisive vote may be called off.

... [T]he timing of the Monday night announcement was telling. It came a few hours after Allen and Rosenberg met with leaders of the Unite for Strength faction, a group of Hollywood moderates who gained five board seats in the fall after campaigning on a platform that asserted that Rosenberg and his allies had bungled the contract negotiations strategy.

Unite for Strength spokesman Ned Vaughn told Daily Variety that he and his colleagues expressed concerns about going ahead with the vote, given the growing numbers of SAG members - particularly high-profile stars such as George Clooney and Tom Hanks - coming on the "no" side. ...

Successful negotiations are (mostly) about leverage. Do you have it? Or do you not have it?

It's been reasonably clear for awhile that SAG is holding neither winning cards nor much leverage. It was the last into the tub, and the deal the AMPTP is prepared to make has been pretty well set since the DGA and WGA ratified their contracts.

I'm not arguing here which side is "right" in the things it wants. I'm pointing out reality. If SAG loses the support of a big faction of major actors -- and SAG has -- it's in a weaker position. If SAG's leaders are divided -- and they are -- the Screen Actors Guild is in a weaker position.

And if SAG sends out strike ballots in January and loses the strike vote -- and it's close to that, for any percentage under 75% is losing -- the guild is beyond weak. Its position becomes hopeless.

The question I always get in studios is: "What's going on with the actors? Are they going to strike?" For the past momth I've given the honest answer:

"I donno."

But if what I'm reading in Variety is true, now my answer is different. There won't be a strike. Because SAG leadership has stopped flailing around long enough to stare at the bright lettering on the wall:

It's over.

Which means that the Screen Actors Guild will ultimately get the deal that everybody else has gotten in 2008, the proposal that is on the table now.

...For half a century, Chicago’s hands-off principles have permeated financial thinking and shaped global markets, earning the university 10 Nobel Memorial Prizes in Economic Sciences starting in 1969, more than double the four each won by Columbia University, Harvard University, Princeton University and the University of California, Berkeley.

Chicago’s laissez-faire imprint underpins everything from U.S. President Ronald Reagan’s 1981 tax cuts and the fall of communism that decade to quantitative investment strategies.

In 1972, Friedman helped persuade U.S. Treasury Secretary George Shultz, former dean of Chicago’s business school, to approve the first financial futures contracts in foreign currencies.

Such derivatives grew more complex after Chicago economists created the mathematical formulas to price them, helping spawn a $683 trillion market that’s proved to be a root of today’s financial system breakdown ...

Friedman, who died in 2006 at age 94, defined the Chicago School in 1974 as he spoke to a board of trustees dinner:

“‘Chicago’ stands for a belief in the efficacy of the free market as a means of organizing resources, for skepticism about government intervention into economic affairs,” he said.

Well, maybe not so much anymore. We're all socialists now.

By the end of November, the government had committed $8.5 trillion, or more than half the value of everything produced in the country in 2007, to save the financial system.

The European Union had ponied up more than $3 trillion to guarantee bank loans and provide capital to lenders. And China had unveiled a $586 billion stimulus plan and its biggest interest-rate cut in 11 years ...

Joseph Stiglitz, who won one of Columbia’s economics Nobels, says the approach of Friedman and his followers helped cause today’s turmoil.

“The Chicago School bears the blame for providing a seeming intellectual foundation for the idea that markets are self- adjusting and the best role for government is to do nothing,” says Stiglitz, 65, who received his Nobel in 2001.

University of Texas economist James Galbraith says Friedman’s ideology has run its course. He says hands-off policies were convenient for American capitalists after World War II as they vied with government-favored labor unions at home and Soviet expansion overseas.

The problem, friends and neighbors, isn't market economies. The problem is unregulated market economies that get leveraged to the hilt and built on assets that are insanely inflated in value.

Nine years ago, I used to read financial commentary that said: "It's no problem that these new start up tech firms have a price-earnings ratio of two hundred or five hundred to to one. It's a new paradigm! Everything's different now!"

There were a lot of animation artists, flush with cash from the high-salaried nineties, who believed the commentators and invested accordingly. Which, of course, was ultimately a mistake. The dot-com mania and bubble of 1999 was a close cousin of the tulip bulb mania and bubble of 1637.

Tuesday, December 23, 2008

I was dining the other night with my favorite retired movie executive (not only is he my favorite, he's the only one I'm friends with.) He shared his opinion about executive pay in particular and working persons' in general:

"Movie execs are way overpaid. They get a base salary, they get bonuses, they get stock options. They usually control the company's board of directors and mostly get everything they ask for, because the directors mostly owe the exec their directorship.

"And when they take stock options, they know how to influence the stock price so that they get the option at a lower point, and exercise the option at a much higher point. It's kind of a racket. [Obviously, this strategy hasn't worked too well over the last six or eleven months ... -- SRH]

"But this deal of $10 million in annual pay, options and bonuses? $20 million? $60 million? It's silly. I keep hearing: 'Oh, we've got to pay that to attract top talent,' but I've never believed it. There are plenty of qualified people who would love to have the job and get paid three hundred thousand or half a million a year. We've gotten into this mode where executives just assume they'll be getting a big pay package because every other executive gets a big pay package. It's the norm. And it's silly.

"I've thought for a long time we need to pay more for workers who are doing really tough, crucial jobs, teachers for instance, and less to executives who don't work nearly as hard and delegate a lot but make way more money because they're in a strategic, money-making place.

I know it's not going to happen, given the way society's set up, but it should happen. Because the pay structures we've got now are nonsense."

This from a guy who made a goodly amount of dough as an exec and is now comfortably retired. Clear-eyed but cynical. My kind of homo sapien.

But let's do a few math and history constructs, and see how things have stacked up through time.

Let us journey back to a halcyon time when the movie industry was roaring, earning money hand over bushel basket, when movie companies turned out nothing but hits and studio lots were paved with gold.

The time was World War II, and every major film company -- 20th Century-Fox, M-G-M, Warner Bros., Paramount -- was well into the black. The U.S. citizenry was fully employed winning the war, and everyone had cash for a theater ticket. It was no accident that the highest paid exec in the United States was one Louis B. Mayer, who made a whopping $1,250,000 per year.

But good old L.B., in the modern age, would have lost his standing as "best paid executive" to another high-flyer named Barry Diller:

The New York Times asks the question whether one-time Hollywood mogul Barry Diller -- presently chairman & CEO of IAC/InterActiveCorp -- is the highest paid chief executive in America...

[O]ne recent study that looked at a broader universe of companies estimated [Diller's] total compensation last year at $295 million -- while another recent survey -- using a different calculation -- figured he was paid $85 million" ...

The chief executives of America's 500 biggest companies got a collective 38% pay raise last year, to $7.5 billion. That's an average $15.2 million apiece. Exercised stock options again account for the main component of pay, 48%. The average stock gain was $7.3 million.

Good thing they got in before the downturn. Or most of these folks would have done worse than Louis.

But reading the above, there's clearly a difference of opinion between journals about who's got bragging rights for highest paid boss guy. Diller's up there, but of course there's this:

The highest-paid boss of the 500 companies we tracked: Apple (nasdaq: AAPL - news - people ) chief Steve Jobs. He drew a nominal $1 salary but realized $647 million from vested restricted stock last year ...

Steve is another one who's lucky to have gotten a big pay day from his options before everything tanked. But forget which of these two is on top. The interesting thing is, L.B. Mayer's paycheck, adjusted for inflation, would be right in the middle of the executive pack. Not the highest anymore, but certainly nothing to sneeze at.

So what about, you know, school teachers? How they have made out from 1941 to now?

In 1941, the average school teacher received a wage of around $2510 a year. (I'm extrapolating a bit from this report, but the range for white school teachers was around $1500 to $2600.)

So what do you know? Adjusting for inflation, teachers in 2007 did better than their 1941 counterparts! Whereas the instructor who made $2510 around the time of Pearl Harbor would make $34,989.61 in 2007 dollars, his or her real world counterpart would be collecting 51 grand, a $16,000 bonus.

Not quite the bonuses that Steve J. and Barry D. pulled down in 2007, but hey! It's something!

However, I think the Wise Old Exec is going to have to wait awhile before his hope of school teachers overtaking American executives in annual salary becomes reality.

Monday, December 22, 2008

Animation here in the southland has been getting squeezed, but rollbacks far to the north are also happening:

Portland-based animation studio Laika Entertainment has laid off 65 people and axed its troubled project in development Jack and Ben’s Animated Adventure. The CG-animated feature was slated to be the studio’s follow-up pic after the upcoming Coraline. Mulan director Barry Cook was signed to direct the film.

This isn't wholly surprising, since Laika has had a lot of hires and outlays the last few years and nothing coming in. (The income half of the equation will start happening when Coraline gets released in February.)

No doubt it's an anxious time to be an animation start-up with a sizable overhead. Or any kind of start-up. We'll see what happens when Mr. Selick's picture hits the AMCs two months from now. Meantime, the company putting the best face on the cuts is totally understandable.

“Basically, we lost some people on the development side for a project we’re not working on any more, which is a natural part of the animation process because it takes so long to make these films and market them,” Begley said. “The layoffs were the result of the project being shelved and Coraline being no longer in production.” ...

“Phil Knight’s commitment to the company is complete and total, and it’s unfortunate what’s happened but it’s something we needed to do from a business point of view,” she said. “Everything at Laika is onward and upward.”

Yeah, hm hm. Onward and upward. Only if Coraline like, under-performs, what's the forward momentum going to look like then?

...In the immediate aftermath of Pearl Harbor, [Walter] Reuther, then head of the [UAW] union's General Motors division, came up with a detailed plan for converting auto plants to defense factories more quickly than the industry's leaders did. At the end of the war, he led a strike at GM with a set of demands that included putting union and public representatives on GM's board ...

In 1949, a pamphlet was published that argued that the American auto industry should pursue a different direction. Titled "A Small Car Named Desire," the pamphlet suggested that Detroit not put all its bets on bigness, that a substantial share of American consumers would welcome smaller cars that cost less and burned fuel more efficiently.

The pamphlet's author was the research department of the United Auto Workers ...

The UAW not only built the American middle class but helped engender every movement at the center of American liberalism today -- which is one reason that conservatives have always held the union in particular disdain ...

Now you can believe what Meyerson writes, or you can dismiss him as another pinko lib, but here's the reality of what's going on today:

For the past thirty years, there has been a general philosopy that everybody would be better off if "government got out of the way." If regulations were lightened or, better yet, eliminated.

If market forces were allowed to work their magic and make the country bigger, better, and richer. No need for regulation or any horrid redistribution of wealth. Markets were magical ... and self-correcting.

The financial and economic crash of 2008, the worst in over 75 years, is a major geopolitical setback for the United States and Europe. Over the medium term, Washington and European governments will have neither the resources nor the economic credibility to play the role in global affairs that they otherwise would have played. These weaknesses will eventually be repaired, but in the interim, they will accelerate trends that are shifting the world's center of gravity away from the United States.

A brutal recession is unfolding in the United States, Europe, and probably Japan -- a recession likely to be more harmful than the slump of 1981-82. The current financial crisis has deeply frightened consumers and businesses, and in response they have sharply retrenched. In addition, the usual recovery tools used by governments -- monetary and fiscal stimuli -- will be relatively ineffective under the circumstances ...

So how the hell did we get here? How did it come to this?

There were lots of causes; here are a few of the major drivers of the debacle:

We stripped away the rules that kept banks and investment companies honest. (When the government allows Godlman Sachs to leverage investments 40 to 1, GS is delighted to do it, figuring they're smarter than everybody else, and if things start to head south, they'll get out and let the suckers hold the bag of crap. Didn't exactly work out that way, of course. Goldman Sachs got swept up in the disaster it helped create, and has now converted its businesses so it can receive Federal handouts. Socialism for the Investor Class! Fuck Yeah!)

We allowed the minimum wage to become ludicrously low relative to the purchasing power it had forty years ago.

No doubt people will argue about specific causes, whether it was more of this and less of that. What's hard to argue is that we are today in a deep, deep economic hole ... and sizable sections of the American middle class are melting away.

What's also hard to argue is that without a middle class, the "American Standard of Living" will cease to exist, because without a population that has money to buy things and send their children to college and generally make their lives better ... thereby lifting the American economy ... we turn into Mexico, India, or Brazil.

We end up with a wealthy oligarchy that lives well in gate-guarded communities and drives expensive cars, with everyone else eking out their various meager existences in small, rented houses and one-bedroom apartments, eating a lot of meatloaf sandwiches.

But enough sweeping generalizations. Let me boil it down to specifics in this narrow, neck of the woods known as the Animation Industry.

When I rolled in here nineteen years ago, the Animation Guild and the cartoon business were on their mutual keesters. We had about seven hundred active, working members. General unemployment was high. Non-union animation work was everywhere (DIC at the time was huge, paying $500 a week for storyboard work, half the union minimum.)

Over the next few years, through happy accidents, also the efforts of various artists, we ended up signing contracts with a lot of studios and repping about 85% (give or take) of the cartoon business. Plus the business was roaring, and a lot of the cut-rate 'toon factories were forced to raise wages in order to hire people qualified to get needed work done.

Like I say, happy accidents.

And then the business went really crazy, and industry wages went through the roof and then the upper atmosphere, and people said to me:

"Heey now! What do we need union minimums for? I'm earning double the damn minimums! And my best friend's making triple! Hot damn!"

People began thinking it was the natural order of things. And would last forever.

But it wasn't ... and didn't. And now we're paddling along in the year 2008, and nobody thinks high wages are a birthright anymore.

In fact, a lot of people are pretty grim. Scared shitless, in fact. And grateful to have a job, any job. I know, personally, animation professionals bagging groceries and doing secretarial work and laboring as security guards at one-fifth their old salaries.

And every studio I know about, union and non-union, is cutting their labor costs every way they can. The non-union places are below the union minimums that they used to be above, and the union places are hiring at scale. But because a large number of skilled artists still work under union contracts, and we still have critical mass, the overall wage structure hasn't collapsed.

Over in auto-building land, the situation is a little different. The UAW, that long-ago builder of the American Middle Class, hasn't been able to organize foreign auto plants in Tennessee, in Alabama, and a number of other southern states that have "right to work" laws. The slope is just too steep for them to get the Toyota, Honda and Nissan plants organized, and so the foreign companies are happy to match UAW pay rates, even as they lowball benefits. And the UAW gets pretty much nowhere in making those Camry, Accord and Altima factories union.

But Senator Mitch McConnell and company are trying their best to disembowel what's left of the UAW. They've made a nice run at it the last month or so, and for a little while, it looked like they would succeed in taking the Auto Workers out. (Of course, it would have meant the Big Three Auto Makers would have gone bye-bye with the UAW, what's known on the battlefield as "collateral damage," but what the hell. Sometimes you gotta destroy an industry in order to save it.)

Now, happily, President Bush has decided he doesn't want to add "Goodbye to the Big Three" to the rest of his sparkling legacy, and so has overruled his Republican cohorts in the Senate and cut a deal with Chrysler and GM. So the companies will survive ... at least for another few months.

But who knows? Maybe Senator Mitch and those other Sons of the South will yet be successful in driving the UAW over a cliff. Maybe Ford, Chrysler and General Motors will slide into insolvency and oblivion anyway, and the Japanese and German car companies will have the United States all to themselves.

When and if that day comes, I'm reasonably certain the foreign car makers won't be paying wage rates that match UAW's workers, for those workers will be gone. They'll be paying less, probably far less, even though labor costs now are only 10% of a car's costs.

Why? Because the union that kept wages up will be gone, along with one more segment of the American middle class.

Sunday, December 21, 2008

Animated features continue to do well around the world (praise be to Jeffrey K. and John L.!).

... It was "Madagascar: Escape 2 Africa" that topped the box office both in France and Germany, looking forward to a strong holiday run for Paramount/DreamWorks Animation.

Overall, "Mad 2" placed No. 2 at the international box office for the frame, grossing a hearty $34.3 million from 5,168 for an international cume of $173.8 million in its seventh week in release. Toon's worldwide total is a happy $343.7 million.

In France, "Escape 2 Africa" dropped 34% in its soph sesh but held top spot. Its healthy cume stands at $16.2 million with holiday biz still to come. German take for the weekend was $7.5 million for a $22 million cume in its second frame ...

"Bolt" grossed $4.9 million from far fewer playdates --1,916 runs -- for an overseas cume of $28.7 million in its third week (Disney is rolling out the family film slowly).

Disney's "Wall-E" wasn't far behind, grossing $4.6 million from 1,030 runs in its 25th week in release for a foreign cume of $277.6 million and worldwide cume of $501.4 million. Pic placed No. 6 ...

Wall-E has been a nice money-spinner for the House of Mouse. Not quite in KFP's territory, but close. It remains to be seen how Bolt performs in all the varying overseas markets. I'm guessing it does about 120-160% of the domestic take after all the tickets are sold, which would carry it to what? A $250-$320 million worldwide box office?

The Collective Bargaining Agreement (the "union contract") says that a week's vacation is based on "straight time earnings," meaning the forty hours of regular pay that employees work each week is what makes up a week's worth of vacation pay.

So here's the new deal (which I explained to a disgruntled artist last week): You work a forty-five, fifty or fifty-five hour week, your vacation pay is based on forty-hours of your straight-time rate in a workweek.

Say you now work a forty-five hour week as a regular thing. That weekly paycheck you get isn't based on the old forty hours formula, but the newer forty-five hour deal (Forty straight-time hours plus five hours at time and a half.)

Which means that overscale employees who shift from the forty-hour week to the forty-five hour week, yet still get the same weekly pay, are going to see their vacation checks shrink because those checks are based on forty hours, and their hourly rate has been cut.

Slick, huh?

Just another way that everyone gets to tighten their belts in these recessionary times.

Topside, Jim Carrey and Will Smith wrest for bragging rights regarding the Number One Weekend Flick, with Carrey's Yes Man winning total box office on Friday, but Mr. Smith and Seven Pounds enjoying a higher per screen average.

Below decks at #7, Bolt takes in $1 million to run its cume to $92 million. And Mad 2 in the 13th slot has pretty much run out its box office string after 43 days of release with a total take of $171.2 million.

Add On:The weekend turns out to be emphatically lacklustre, which the Wise Heads of Hollywood attribute to lousy weather. (Lacklustre films have nothing but nothing to do with it.)

Jim Carrey comes out #1, sitting atop a very small heap of $18.1 million. Will Smith finds that few come out to see noble self-sacrifice, and Seven Pounds collects a mer $16 million.

The Tale of Despereaux makes off with $10.5 million, a lot of it presales, but the mouse story should have an okay glide path through Christmas vacation. I'm sure Universal is well pleased.

Meanwhile, Bolt resides at seventh place, collects $4.25 million, and now has $95 million in the till. (I'm thinking it might fall short of my earlier $120 million domestic projection, but we'll see.)

And Mad 2 carves out a bit more cash, now standing tall with a domextic box office total of #172.3 million.

Friday, December 19, 2008

(c) Disney Co. via ASIFA Animation Archives ... click on the image to enlarge it and, you know, SEE it better.

More linkage for a Friday afternoon ...

The animated feature The Tale of Despereaux comes rolling to town, and we get to see how the box office holds up stateside. Visually, the trailer blew me away, but who knows how it holds up story-wise?

“Our goal was to give Despereaux, the other characters and the settings in [the mythical European town of] Dor a painterly, atmospheric look,” says Despereaux production designer Evgeni Tomov. “Much like the rich Flemish paintings, Dor and its citizens needed to look as if they belonged in the Middle Ages. We knew they should not only be beautiful, but also moving and emotionally engaging. We wanted this organic, immersive quality to the film. We deliberately chose a very muted and subtle palette. We did not want saturated, vinyl or obviously digital colors.”

Framestore Animation created the visual style in a computer-generated environment by applying traditional painting techniques. Painters created 2-D digital matte paintings and also touched up 3-D renders with minute detail. They were seeking the look of the paintings of the Flemish masters, who often let detail fall off into shadows in their work and added sharper detail in the focal area ....

... Taking advantage of the advances, Katzenberg said he had retooled his studio to work exclusively in 3-D from the first storyboard.

That contrasts with the approach of other studios, which have typically animated films in 2-D and then post-produced them in 3-D (such as Walt Disney Animation Studio's "Bolt").

After seeing the system in action, I think that 3-D is going to be the dominant theater format in the next 2-6 years. It's way better than the 1950s version.

Oscar pundits -- many of whom you and I have never heard -- handicap the odds for Wall-E getting a Best Picture nomination:

T.L. Stanley (Gold Rush, HollywoodReporter.com) isn't optimistic: "As much as I'd like to see it happen — "Wall-E" was one of my favorites this year — I doubt it will." Ed Douglas (Comingsoon.net) pooh-poohed the notion: "There are too many good live-action films vying for those five spots."

... Mark Harris (Entertainment Weekly) and Scott Feinberg (Feinberg Files, The Envelope) both point to a key factor — how Oscar voting works, technically speaking. "Wall-E" has a lot of passionate supporters. "When I think about the importance of the preferential ballot, 'Wall-E' strikes me as a movie that's going to get a lot of No. 1 votes,"

It's simple. Once in a long while, an animated film will get nominated for the Top Slot. Who knows? Maybe Wall-E will be the second film to get tapped. But an animated feature has the same chance of actually winning Best Picture as Michael Moore becoming the next Republican Senator from Michigan.

Degeneration will whet your appetite for the upcoming Resident Evil 5 video game. It’s a departure from the live action movies that came before it. This installment of the film is taken into the universe of the original video game. Gone is Milla Javovich’s Alice for Claire Redfield and Leon Kennedy, names that fans of the video game series will find familiar.

This new direct-to-video release will be available on Blu-ray or DVD on December 27th. It’s a computer animated movie that probably wouldn’t have received much attention at the box office. But the film is a professional production worthwhile to any anime fan and a must-see for fans of either the video games or movies ...

Real Estate Booklyn has a fine history of young Max Fleischer, to wit:

... In 1900, 17-year-old [Max] Fleischer took a fateful bike ride over the Brooklyn Bridge to the downtown offices of the Brooklyn Daily Eagle. He finagled a meeting with Herbert Ardell, then director of the Eagle's art department. Max wanted to pay the Eagle $2 dollars a week to learn the craft from his idols. Ardell instead offered Max a salary of $2 dollars a week to run the art department's errands. Soon he was doing work far beyond the usual chores ...

It was just a short logical leap from Fleischer's Daily Eagle-era comic-strips to flipbooks on the screen to animation ...

ASIFA's Animation Archives has some dandy Disney Christmas cards (see above) from way back, when the studio gifted their employees with Warm Holiday Wishes each season (I remember when we got some of these).

Lastly, an edgy take on the non-animation Christmas classic It's A Wonderful Life, linked here because of the resonance the film has in these interesting financial times:

... Think about it: In one scene George helps bring manufacturing to Bedford Falls. But since the era of “It’s a Wonderful Life” manufacturing in upstate New York has suffered terribly.

On the other hand, Pottersville, with its nightclubs and gambling halls, would almost certainly be in much better financial shape today. It might well be thriving ...

That I keep getting asked about, over and over. Because I'm like, a union rep.

"So is SAG going to vote for a strike? Put us out of work?"

For a long time I've thought Mr. Rosenberg and Mr. Allen over there in the thespians' jurisdiction had painted themselves into a dandy corner negotiation and job action-wise.

The economy's crashed.

Unemployment is soaring.

SAG membership has splintered.

And now they're trying to pull off a 75% "yes" vote for doing that job action, otherwise known as "strike" ...

Nice hat trick if you can pull it off, but for a while now I've been dubious about them pulling it off. Month by month, SAG's situation has been steadily unraveling. Craig Mazin at Artful Writer has come to the same general conclusion:

... In the span of just a few days, an open, sizeable and organized revolt [inside SAG] began. It started with letters from individual SAG members like Jason Alexander asking their fellow actors to vote “no” on the authorization vote. Then the New York SAG Board officially came out against the authorization.1 Alan called a compulsory national meeting to address this schism, then apparently realized he couldn’t actually compel that, and so he withdrew that meeting. This was followed by a statement against the authorization by 130 actors ...

This general disintegration has been fairly obvious for some time. These folks have minimal leverage, and there's not much they can do about that. They started de-leveraging when they cleverly refused to merge with AFTRA and control the entire acting work force ... and they've been cutting their own throats ever since. Which is a shame, because I'm not in favor of labor becoming less powerful.

But the reality is what it is. I don't like to bullshit myself. There's no upside to it.

Thursday, December 18, 2008

There's been a lot of coverage about financial advisor/guru Bernie Madoff, and how a whole lot of folks, many of them real rich, have now gotten burned:

... “The level of devastation, both financial and on a human level, is astounding,” said Robert J. Ivanhoe, a lawyer who is representing 10 developers and investors who lost $5 million to $50 million each with Mr. Madoff ...

“They knew him from golfing in the Hamptons. They knew him from the locker rooms,” [lawyer Jerry] Reisman said. “He was considered a wizard.” ...

See, there's the problem right there. Wizards exist in "Harry Potter" novels and other books, but they aren't real. Anytime somebody thinks they've come across a wizard, what they've actually encountered is something too good to be true.

You can't really go on earning 10% or 15% a year when everything is tanking. It's just not possible. I have a friend who's a big believer in Bob "Market Timer" Brinker, a knowledgeable but fallible financial advisor who dispenses investment wisdom on the radio. Good old Bob, who's shtick is getting his followers in and out of the stock market with their money stash intact when things get dicey, completely missed the Fall meltdown of the stock market.

And his followers, many of whom thought he was the end-all and be-all, ate it.

So how is this possible? What with old Bob's proprietary systems for gauging where the equity markets are going? With his vast knowledge of how everything fits together and works?

Because nobody, not a living soul, can predict with certainty what hundreds of millions of people will do with their money on any given day. Oh, they can consult past economic histories and models and make educated guesses, but they can't know.

So what does this have to do with the animation community? Simply this. Many artists out there have built up assets over the course of lengthy careers, and a lot of them say:

"I don't know a thing about investing. I'm an artiste. Show me a good financial advisor who will take care of my 401(k), IRAs, and investment money for me. Show me somebody who will handle all this icky money stuff."

So here's my two cents: Don't rely on outside "wizards" who claim to have the stock market wired and know what you should do with your loot. Educate yourself. Spend a half hour every day boning up on investing, looking at the business section of the paper or intertubes. Give yourself an education on investing. It's cheap and not particularly strenuous. You don't have to end up being Warren Buffett, you just need to own some basic knowledge of market fundamentals and different investment classes.

Then make your own investment decisions. Ask for outside opinions when you need them, but make the calls about where your money goes by yourself. If you're most comfortable putting everything in CDs or money market funds because you freak out at the idea of losing money in the stock market, go do it. If you're okay with the higher risk of stock markets to get higher returns, then do that.

But know what you're about and why you're about it. Rely on yourself. Don't buy into magic pie in the technicolor sky, because that stuff is, in the end, fantasy fiction.

As people who believed in Bernie Madoff's wizard potions and spells are now finding out. Because "wizards" all too often end up being crooks.

I spent a long stretch of a rainy Wednesday afternoon at Cartoon Network's Burbank Studio, where I chatted up three floors of animation artists and directors and got informed of the following:

Chowder is winding down on what is -- apparently -- the final nine half-hours of the series.

Thirteen half-hours of Adventure Time -- out of the prolific development shop of Mr. Fred Seibert -- launched last week. (If you follow the link, you will note that Adventure Time the short was produced a while ago ... and produced under the umbrella of Fred S./Random Cartoons/Nickelodeon. But AT has since moved over to Cartoon Network ...)

The 20 new episodes of Flapjack are well underway (but you know this from the previous post about CN, do you not?)

And there are 39 shorts in development at the studio (which I call "son of workshop of Fred S."). And a Wise Old Animation Vet told me:

I would be real surprised if the studio doesn't get two, three or more series going from this crop of shorts. I don't think they'll roll new series out all at once, but one at a time. Over a couple of years."

Would that it will happen. (And I got to see a loop of test animation from one of the shorts, and whattayaknow! It looks like a cartoon! An old time, hand-drawn type cartoon!)

Wednesday, December 17, 2008

At last, what the world and herb lovers everywhere have been waiting for.

"Cheech and Chong's Smokin' Animated Movie" ... Lou Adler, the music impresario who discovered Cheech Marin and Tommy Chong in the early 1970s and owns their classic library, has sold the animated rights to DVD producer Big Vision Entertainment and Chambers Bros. Entertainment.

So is this going to be like, in 3-D? CGI?.

My eyes are bloodshot already.

But isn't this epic coming out maybe thirty years too late? ... Or is it never too late?

The animation community lost a lot of veterans this year. As we do, sadly, almost every year.

Now that we are close to Yuletide, we note those who have moved on. In case you missed their departures when they happened, you will find a partial list below the fold ...

(We'll be honoring these and many more of our late companions at our annual Afternoon of Remembrance, scheduled for February 7, 2009 at the Lasky-DeMille Barn across from the Hollywood Bowl.)

John Ahern. Layout artist, animator and director. He had a long career from which he retired in the early 2000s. -- October 29, 2008

Gordon Bellamy -- animator, designer of robots, and long-time Manhattan resident. He worked at Disney in the fifties and animated on Brad Bird's Iron Giant, but what we remember him for around here are his descriptions of the terror attacks on 9/11, for he lived blocks from the World Trade Center. -- January 29, 2008

Bob Carr -- an animator who started at Disney in the 1950s, then went on to Hanna-Barbera, Filmation and Bakshi, retiring after his work on American Pop -- September 27, 2008.

Charlie Downs -- Animator, story artist, designer, with a long career at Disney and other studios. -- July 21, 2008.

Ollie Johnston -- legendary Disney animator and the last of the Nine Old Men. He worked on almost every Disney feature between Snow White and The Fox and the Hound. Ollie was also co-author of the best-selling The Illusion of Life, an animation bible if ever there was one. -- April 14, 2008

Ted Key -- the father of America's favorite maid Hazel, but also the creator of the immortal Mr. Peabody and Sherman. -- May 3, 2008

BriceMack -- a veteran Disney background artist (Fantasia, Peter Pan, Lady and the Tramp) who went on to run his own studio. -- January 2, 2008.

Bill Melendez -- animator, director producer and studio owner. He walked out of Disney's in 1941, striking with his fellow artists for better wages and treatment, but what he'll be remembered for is the "Peanuts" characters he brought to life on the television screen. A Charlie Brown Christmas and some of the others will probably run on the tube until the sun reaches its red-star phase. -- September 2, 2008.

Sony Pictures Animation has inked a first-look production deal with Ellen Goldsmith-Vein's the Gotham Group.

Deal marks the first-ever first-look pact for SPA, a unit of Sony Pictures Digital Prods., which was overhauled in March with Hannah Minghella being named prexy of the division.

As the leading management firm for toon and kids content creators, Gotham Group offers a nice fit for SPA, which is looking to ramp up its efforts after a number of its projects have stalled in development ....

Staffers have told me SPA continues to be somewhat dysfunctional, although Cloudy With a Chance of Meatballs is well into production (and looks pretty good, judging from the few visuals on various computers screens that I've been privileged to see.)

Sony Pictures Animation, I think, has been cursed with lousy timing. Open Season had pretty good grosses for a first-entry -- not great, but okay. And then Surf's Up, a quirky feature that got good reactions from the critics and audiences that viewed it, ended up being the third penguin picture out of the chute and pretty much tanked. (A sour fate. I've yet to encounter an animation pro who didn't tell me: "Hey, it's good!" when he or she finally got around to actually seeing the flick.)

The one thing with which this Gotham partnership might help is building SPA a more extensive development slate ... which would be useful, because SPA's project pantry has been understocked the last few years.

Monday, December 15, 2008

"Delgo" earned a measly $511,920 this weekend on 2,160 screens, not even breaking the top ten. That's an average of $237 per screen for the three days. If you figure there were five screenings a day, and assume ticket prices are about $8, that comes out to two people in the theater per showing. By comparison, the Golden Globe-nominated drama "Doubt" earned roughly the same amount of money, but it was only in 15 theaters ...

So the brave littl start up down in peach tree country gets its move completed ... and falls on its keester.

It's like Rocky Balboa getting tangled up in the ropes as he climbs in the ring, and knocking himself out.

There wasn't the sort of marketing budget needed to make a film stand out in the already crowded holiday movie season. ... Another problem was the quality of the movie. Or lack thereof ...

Yesss. The quality.

See, there's a secondary lesson to be learned here. It's not always enough to have spunk, gumption and enthusiasm. You must also have a level of talent that delivers a product that audiences want to see.

So early last week I get a number of phone calls from staffers at Disney Animation Studio ... which pretty much goes like this:

"Hi. We've had some meetings over here, in the theatre. And management is telling us that the studio is going to a 45-hour workweek, but nobody is going to get their salaries rolled back, and some people will be getting wage bumps, and that some production support people are getting let go.

"Can they like, do that?"

My answer is yes, with a long-winded explanation. Then I get asked to come over and visit, and a few days later I do ...

When I walked into the hat building last Friday morning, most everyone I encountered had similar questions about the meetings earlier in the week, about why the studio is doing the 45-hour thing. I responded to questions for an hour and a half, the same way I did over the phone; below is a compilation of my answers, attached to the employee questions:

Q: At our meeting, they told us the studio's moving to a mandatory 45-hour week on our next picture. I thought the regular work-week was forty-hours. What gives?

A: I assume the studio's going to a forty-hour week with five hours of required, pre-paid overtime. They have the right to demand "reasonable" amounts of overtime from employees, so the forty-five hour work-week is certainly doable. (Unlike DreamWorks Animation, most Disney Feature employees work without personal service contracts and are "at will.")

Q: They told us that a lot of employees would be getting the same pay, but some of us would be getting pay hikes. What's up with that?

A: Based on what I've been told, over-scale employees are getting their hourly wages cut, since they are now working an extra five hours of overtime (calculated at 1 1/2 times their hourly rate) at the same weekly salary. So, their previous hourly rates -- based on the old forty-hour week -- would have to be trimmed to accommodate the new five hours of o.t. being built into the same weekly wage.

Q: Can the studio do that?

A: Sure the studio can do that, if you the employee remain above the collective bargaining agreement's minimum hourly rate for his or her classification. What they're doing -- and this is a rough calculation -- is cutting above-scale employees hourly wages by around 15%-18% when they build in the extra hours.

Q: And some people are getting a bump because ...?

A: Because they're working at scale ... or close to scale. And the studio has to increase their weekly salary because it's adding five extra hours at time and a half, and everybody has to stay above the minimum rates. So ... more money for them.

Q: Why is the studio making these changes?

A: I think they want to cut labor costs as much as possible. But they have to make the cuts within the parameters of the Collective Bargaining Agreement. Hence, scale employees receive more weekly pay, over-scale employees get lower hourly rates.

Q: They're not framing it quite that way.

A: I'm assuming they're putting a sunny spin on it. But they haven't confided in me, so I'm making an educated guess about their inner thoughts and motivations.

Q: Well, I'm happy I at least still have a job.

A: A lot of people have mentioned that. Great times we live in, huh?

Disney isn't alone in its Hollywood belt-tightening. We're in a recession, and every entertainment conglomerate is hack-hack-hacking away.

A little kid with a Christmas tree, accompanied by a little angel. The girl looks suspiciously like my younger sister at a tender age, so I wonder if this was done in '60 or '61? When she would have been two? ...

Sunday, December 14, 2008

For years I've thought that DreamWorks Animation has had a daunting business model: Produce a hit movie, then produce another hit movie, then produce ...

This is, in Hollywood, kind of a tough act to repliacte over and over. Lately, however, DWA has performed that particular parlor trick in spades. And now its branching out:

DreamWorks Animation SKG is launching its franchise characters into new lines of business, giving the Glendale studio a chance to grow steadily and consistently even during a recession that already is slowing its DVD sales.

In their first investor conference since 2005, studio executives Thursday outlined a series of new business ventures to lessen DreamWorks' dependence on production of only two animated movies a year, which often has led to big swings in its earnings and stock price.

DreamWorks will feature the studio's popular characters in TV specials for NBC, for instance, as well as in theme park attractions in Dubai and Singapore ...

Pixar used to be the only stand-alone animation studio with a track record like DreamWorks -- better even. But Pixar is now a division of the Disney Co., while DreamWorks continues under the power of its own cash flow and profit margins.

Katzenberg said the studio, which is expanding its Glendale campus to accommodate growth, would thrive amid the economic downturn. Unlike its rivals, DreamWorks does not own a television network and thus is less dependent on fickle advertising revenue.

Katzenberg also noted that the studio had developed a more consistent track record at the box office by spending more time developing story lines and by hiring experienced directors and producers ...

DreamWorks has banked heavily on the new technology and is planning to release all of its upcoming films in 3-D, starting with its next feature, "Monsters vs. Aliens." ...

Last night I saw a 3-D preview of Monsters, and it looks spectacular. The images come right out and hover in front of you. M v. A is the Spring '09 offering out of Dreamworks' brimming treasure chest, and if it doesn't make a boat-load of money in its opening weekend and several weekends thereafter, I'll eat my front lawn.

Next thing you know, the company will be bulding their own stateside amusement park.

So, as regards my earlier doubts regarding the viability of DreamWorks Animation's business model, I gotta say ... I've had my head stuffed up my large intestine.

Saturday, December 13, 2008

...if fate had been a little kinder, a “Spirit” feature film would have debuted in the 1980s that would not only have been revolutionary but -- those of us involved in it were convinced -- a huge hit ...

... if our “Spirit” had lived and had been as successful -- both creatively and commercially -- as I remain convinced it would have been ... would he [John Musker] have been tasked to animate “The Green Hornet?” ... what if the [Diseny Animation] department had been gutted of talent? ...

Ah yes, I remember those halcyon days as if they were only a quarter century ago.

What if Eisner and Katzenberg had bought my reimagining of Gone With the Wind with Mickey, Donald and Goofy as Scarlett, Rhett and Ashley Wilkes? I tremble to think. I could have been somebody instead of the washed up bum you see before you today.

Some of Mr. Leiva's facts and suppositions are a little different from what I remember at the time, but hell. The "What If" game is always fun to play . Pointless, but fun.

Trouble is, there's only the things that happened, not the things that could have happened if cruel fate ... or some dim-bulb Hollywood executive ... hadn't gotten in the way.

The thoughts and observations of the leaders of The Animation Guild (TAG), Local 839 IATSE. Jason MacLeod is the Business Representative, KC Johnson is the President. Mike Sauer is Assistant to the Business Representative.

This weblog reflects their individual personal opinions and does not necessarily represent the official position of the Animation Guild.

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